Very grateful for all the great things that Mike did to help get the company and the B2B business moving in the right direction. And he is continuing as an adviser to help us on the transition. That business is reporting to me today while we find a successor. And specifically, we’re looking to sort of add more capabilities to the team around the growth area, which is Software-as-a-Service. So, we’re grateful for all that Mike did. We are really optimistic about the future of that business and Payments in general.
Lance Vitanza: Thanks. And maybe just one quick follow-up, if I could, regarding lockbox? Would you describe — I mean I think in the past, right, you’ve described that business as in somewhat of a long-term secular decline. And I’m just wondering, I mean, should we expect — shouldn’t we expect that business to kind of be industry-wide, that business to be sort of down mid-single digits from here on out? And I’m wondering when you talk about a little bit of softness, was it softness relative to that? Or do I have it wrong, and that’s a business that in a better period would be flat or perhaps even growing?
Barry McCarthy: So, first of all, I think it’s important to talk about the complexion of the B2B business in total. And it’s roughly split between the lockbox business and the growing Software-as-a-Service business. And so, on the lockbox side of the business, yes, there are secular headwinds in that space. But what you’ve seen us do over the last couple of years is that we have significant market share gains or we have win new business, and then that helps mitigate the decline there. And we’ve had some very significant wins there. And then you saw, of course, in the fourth quarter of last year where we took on volume from a competitor that had an outage, that helped us deliver a really terrific result in Q4 of last year. We have got a big pipeline.
And we think we’ll continue to add clients on the lockbox to provide some stability. But to be clear, we’re focusing more and more on the Software-as-a-Service side of the business, because we see that as the future. We had a successful launch of our new receivables product, and we’ve got an opportunity next week to be in front of hundreds of customers at our annual customer event, where we’ll be sharing more details, expect to build more leads and help that side of the business accelerate.
Chip Zint: I would just add that you’re right, Lance, that the lockbox business, in aggregate, is generally in decline, like the rest of the paper parts of our business. We continue ourselves to innovate in different ways to move it to more digital. We’re really focused on the efficiency of that business and improving the margins and profitability, which as you heard in our prepared remarks, we did a lot of that this year through site consolidation and other efficiency initiatives. Even despite the softness, the volume challenges we had, we were able to expand margins there, which is really a testament to the opportunity we have to, not only continue to look for opportunities to partner with customers and take on more volume, but we continue to run those operations in a more efficient way and expand the EBITDA margins for that business as well as B2B in totality.
Lance Vitanza: Super helpful. Thanks, guys. Congrats again.
Operator: Your next question comes from the line of Charlie Strauzer from CJS. Please go ahead.
Charles Strauzer: Hi, good morning, and thanks for taking my questions. Just if we could focus a little bit on the free cash flow guidance, the $60 million to $80 million that you provided there? Coming off with a pretty strong in ’23, looking at the guidance, what are the drivers and assumptions built into that guidance range? And then, what could potentially [indiscernible] you from exceeding that range?
Chip Zint: Yeah. Thank you, Charlie, and good morning. Thank you for joining us. I think I want to first acknowledge the obvious that I did lower that free cash flow guidance range on the Q3 call from our original full year guidance of $80 million to $100 million for 2023, down to $60 million to $80 million. And I did that based off two factors. As you’ll recall, I did that based off where we were year-to-date through the third quarter, as well as through the introduction of North Star, adding more potential cash restructuring charges as we set the company up. It was the responsible and wise thing to do to reset that range at the time. Now, however, we didn’t change our internal focus on running hard at cash flow and continuing to optimize things across the portfolio.
So, when you look at our final result coming in way ahead of where I reset guidance to, that was really a function of the incredible work the team has done to really work on working capital efficiency. I was very impressed with how the team worked inventory down as the year progressed. As an example, as soon as we got through the ERP upgrade, the team worked very hard working through all of the challenges we had dealt with around inventory, starting back in 2021. You think about supply chain disruptions, inflation, as well as the ERP project, we finally got the chance to work through and really bring that down, which was a great working capital efficiency for us. We were also very efficient on our DSO and other levers. So, I do want to acknowledge that this beat is a great thing and I’m very pleased with what the team did.
